Sept. 6 (Bloomberg) -- A six-minute drive from Ralph Wilson
Stadium, home of the National Football League’s Buffalo Bills,
Duff’s Famous Wings partner Phil Kinecki is worried by two
things: The team’s performance and the price of chicken.

An eighth straight losing season for the Bills, who haven’t
made the playoffs since 1999, would hurt the restaurant’s sales,
and the cost of chicken wings, a game-day staple, has almost
doubled in the past year. Bars in Buffalo, New York, popularized
deep-fried wings in the 1960s, and Duff’s sells about 1,200
pounds of them when the Bills play, 50 percent more than most
days. Americans eat about 25 billion wings annually, industry
data show.

Food items popular during the U.S. football season, from
corn chips and burgers to nachos and wings, are rising after the
worst drought since 1956 damaged crops and increased the cost of
feeding livestock. Tyson Foods Inc. and other poultry producers
have cut output, boosting prices for buyers including chicken-and-beer dining chain Buffalo Wild Wings Inc. as the NFL starts
its first full weekend of games on Sept. 9.

“Chicken-wing prices are high, but they’re going to get
worse,” Kinecki said by telephone from his Buffalo-area
restaurant. The Bills play their first regular-season game on
Sept. 9 against the New York Jets. “A bunch of our vendors said
they’re expecting rises in chicken and beef prices. We’re pretty
worried about it.”

Corn Chips

Wholesale wings in the U.S. were at $1.855 a pound
yesterday, up from 90 cents a year earlier, and in March reached
$1.90, the highest on record at the U.S. Department of
Agriculture. At Duff’s, Kinecki said he is paying $2.12 a pound
compared with $1.09 a year ago. Ingredients for nachos are up 20
percent in the year through July and near an all-time high
reached in March, according to an index compiled by Bloomberg of
monthly prices for corn chips, beef, processed cheese and pinto
beans tracked by the Bureau of Labor Statistics.

Corn and soybeans reached records in the past month, and
global food costs tracked by the United Nations jumped 6.2
percent in July, the most since November 2009. Food prices were
little changed in August, UN data show. The USDA said July 25
that domestic food costs will rise 3 percent to 4 percent next
year, from 2.5 percent to 3.5 percent this year. Beef may gain
as much as 5 percent, the agency said.

Rising food prices may slow demand from consumers, said
John Davie, the president of Boston-based Dining Alliance, which
represents about 10,000 U.S. restaurant companies.

“You’re not going to see the 99-cent wing promotions like
you used to,” Davie said by telephone from Boston. “People are
still out and restaurants are still busy, but revenues still may
go down because people are more conservative about how much
they’re spending and how much they’re going out.”

Super Bowl

The price of wings sold at restaurants and supermarkets
usually falls after the NFL Super Bowl in February and the
National Collegiate Athletic Association’s Division I Men’s
Basketball Championship Tournament in March, said Tom Super, a
spokesman for the Washington-based National Chicken Council.
That didn’t happen this year because producers cut output to
limit losses from surging feed costs.

Buffalo Wild Wings, based in Minneapolis, said July 24 that
the cost of its wings in the quarter starting July 1 will be 68
percent higher than a year earlier. That compares with 3 percent
for all other commodity costs.

While the U.S. chicken industry returned to profit in
January after months of losses amid a supply glut, production
declined in the first half of 2012 and rising feed costs
threaten to erode profit margins, according to Stephens Inc., an
investment bank in Little Rock, Arkansas.

Grain Costs

The industry may be unprofitable in the fourth quarter,
Joseph Grendys, the chief executive officer of Koch Foods Inc.,
the fourth-largest U.S. producer, said by phone from Park Ridge,
Illinois. Costs will rise 10 percent to 15 percent “across all
product lines” next year, he said. The closely held company is
discussing prices with customers and expects one-year supply
contracts to include clauses allowing for quarterly adjustments
based on grain costs, he said.

Deep-fried chicken wings were dubbed Buffalo wings because
they were first served in 1964 at the Anchor Bar in the city,
according to the National Chicken Council. Teressa Bellissimo,
the bar’s owner, would fry leftover chicken wings in hot sauce
for her son and his friends and they were so popular she put
them on the menu.

The price of wings will probably reach $2 a pound this year
because of the drought, said Davie of the Dining Alliance, which
works with smaller restaurants and chains to procure bulk
pricing.

Kinecki, who co-owns Duff’s Famous Wings with Nick and
George Pittas, said suppliers haven’t told him what it will cost
to buy wings for the rest of the year.

Team Success

“You know everything’s going up, but the problem is how do
you plan for it if you don’t know how much,” Kinecki said. “In
this economy, you’re trying to keep the customer happy, but you
have to stay in business.”

Another unknown is how the Bills will fare, a key to Duff’s
business, Kinecki said. The success of the team, which has never
won an NFL championship, will determine how many people visit
the restaurant for wings, nachos and beer, he said. The Bills
lost all four of their preseason games this year, after winning
six of 16 games last year. They tied for last in the American
Football Conference-East.

“The better the Bills do, the more people want hang out
with fellow fans,” Kinecki said. “You’d like to be optimistic,
but then the preseason comes and they look crummy.”